XML 29 R18.htm IDEA: XBRL DOCUMENT
v3.23.3

Derivative Instruments | 9 Months Ended
--- | ---
Oct. 28, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
DERIVATIVE INSTRUMENTS | DERIVATIVE INSTRUMENTS The Company is exposed to risks associated with changes in foreign currency exchange rates and uses derivative instruments, primarily forward contracts, to manage the financial impacts of these exposures. The Company does not use forward contracts to engage in currency speculation and does not enter into derivative financial instruments for trading purposes. The Company uses derivative instruments, primarily foreign currency exchange forward contracts designated as cash flow hedges, to hedge the foreign currency exchange rate exposure associated with forecasted foreign-currency-denominated intercompany inventory sales to foreign subsidiaries and the related settlement of the foreign-currency-denominated intercompany receivables. Fluctuations in foreign currency exchange rates will either increase or decrease the Company’s intercompany equivalent cash flows and affect the Company’s U.S. Dollar earnings. Gains or losses on the foreign currency exchange forward contracts that are used to hedge these exposures are expected to partially offset this variability. Foreign currency exchange forward contracts represent agreements to exchange the currency of one country for the currency of another country at an agreed upon settlement date. These foreign currency exchange forward contracts typically have a maximum term of twelve months. The sale of the inventory to the Company’s customers will result in the reclassification of related derivative gains and losses that are reported in AOCL into earnings. The Company also uses foreign currency exchange forward contracts to hedge certain foreign-currency-denominated net monetary assets/liabilities. Examples of monetary assets/liabilities include cash balances, receivables and payables. Fluctuations in foreign currency exchange rates result in transaction gains or losses being recorded in earnings, as GAAP requires that monetary assets/liabilities be remeasured at the spot exchange rate at quarter-end and upon settlement. The Company has chosen not to apply hedge accounting to these instruments because there are no anticipated differences in the timing of gain or loss recognition on the hedging instruments and the hedged items. As of October 28, 2023, the Company had outstanding the following foreign currency exchange forward contracts that were entered into to hedge either a portion, or all, of forecasted foreign-currency-denominated intercompany transactions:
(in thousands) | Notional Amount (1)
Euro | $ | 51,476 |
British pound | 44,599 |
Canadian dollar | 19,122 |
(1) Amounts reported are the U.S. Dollar notional amounts outstanding as of October 28, 2023. As of October 28, 2023, foreign currency exchange forward contracts that were entered into to hedge foreign-currency-denominated net monetary assets and liabilities were as follows:
(in thousands) | Notional Amount (1)
United Arab Emirates dirham | $ | 22,058 |
(1) Amounts reported are the U.S. Dollar notional amounts outstanding as of October 28, 2023. The fair value of derivative instruments is determined using quoted market prices of the same or similar instruments, adjusted for counterparty risk. The following table provides the location and amounts of derivative fair values of foreign currency exchange forward contracts on the Condensed Consolidated Balance Sheets as of October 28, 2023 and January 28, 2023:
(in thousands) | Location |  | October 28, 2023 |  | January 28, 2023 |  | Location |  | October 28, 2023 |  | January 28, 2023
Derivatives designated as cash flow hedging instruments | Other current assets |  | $ | 5,114 |  |  | $ | 32 |  |  | Accrued expenses |  | $ | — |  |  | $ | 4,986 |
Derivatives not designated as hedging instruments | Other current assets |  | 18 |  |  | — |  |  | Accrued expenses |  | 10 |  |  | — |
Total |  |  | $ | 5,132 |  |  | $ | 32 |  |  |  |  | $ | 10 |  |  | $ | 4,986 |
The following table provides information pertaining to derivative gains or losses from foreign currency exchange forward contracts designated as cash flow hedging instruments for the thirteen and thirty-nine weeks ended October 28, 2023 and October 29, 2022:
|  |  | Thirteen Weeks Ended |  | Thirty-Nine Weeks Ended
(in thousands) |  |  | October 28, 2023 |  | October 29, 2022 |  | October 28, 2023 |  | October 29, 2022
Gain recognized in AOCL (1) |  |  | $ | 7,151 |  |  | $ | 2,723 |  |  | $ | 7,202 |  |  | $ | 10,447 |
(Loss) gain reclassified from AOCL to cost of sales, exclusive of depreciation and amortization (2) |  |  | (326) |  |  | 3,909 |  |  | $ | (2,940) |  |  | $ | 11,718 |
(1)Amount represents the change in fair value of derivative instruments. (2)Amount represents (loss) gain reclassified from AOCL to cost of sales, exclusive of depreciation and amortization, on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) when the hedged item affects earnings, which is when merchandise is converted to cost of sales, exclusive of depreciation and amortization. Substantially all of the unrealized gain will be recognized in costs of sales, exclusive of depreciation and amortization, on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) over the next twelve months. The following table provides additional information pertaining to derivative gains or losses from foreign currency exchange forward contracts not designated as hedging instruments for the thirteen and thirty-nine weeks ended October 28, 2023 and October 29, 2022:
|  | Thirteen Weeks Ended |  | Thirty-Nine Weeks Ended
(in thousands) |  | October 28, 2023 |  | October 29, 2022 |  | October 28, 2023 |  | October 29, 2022
Gain (loss) recognized in other operating loss (income), net |  | $ | 2,193 |  |  | $ | 504 |  |  | $ | (239) |  |  | $ | 2,276 |

X
- References No definition available. + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 40 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480237/815-40-50-5 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 5C -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480434/815-10-50-5C Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 815 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//815/tableOfContent + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration